Weekly update #28

Welcome to this edition of the weekly newsletter. The idea behind this activity is to gather all the information in the startup ecosystem in one place, with a special focus on the fintech market.

This week I’ve been reading two very interesting pieces of content about the fintech and VC ecosystem. The first one is a report called “The rapid evolution of payments in latin America”,  produced by McKinsey & Company , that highlights how the Latin America reacted to the increase of use of cashless solution, and to less cash around. The second content is a report on the status of the VC ecosystem in Italy, called “2023 Venture capital scanner”, a complete analysis on the status of this industry in Italy by Bain & Company .

Starting from the first one, it seems pretty clear that for McKinsey cash is no longer Latin Americans’ preferred way to pay, as debit cards, credit cards, and mobile payments have gained fans, presenting opportunities for financial-services companies.

According to recent surveys polling over 15,000 people across Spanish-speaking Latin America in 2021 and 2023, a monumental shift is underway in how people prefer to pay. Gone are the days when cash ruled supreme. Overwhelmingly, respondents in 2023 showed a clear preference for debit cards, credit cards, and mobile payments over cash. This is remarkable considering Latin America's traditional reliance on cash transactions.

Latin America has experienced significant growth in payments revenues, with projections indicating continued expansion. This presents a golden opportunity for banks and financial-services companies to tap into a burgeoning market.  One of the main topic in this direction, is the ease of use by final users, and here I’ve discovered something pretty interesting:

There is an inverse correlation between people who prefer digital payments and people who prefer tap and pay with a card. While sometimes it’s possible to think that those methods are pretty easy to use, and maybe similar in some ways, data show that people who like to tap are not using digital payments, and vice versa.

The main takeaway from the report: financial institutions should push more on the digitalization of the payment flow, with one main focus, pushing more and more merchants to accept credit card, debit card and cardless methods. Because it is clear that Latin America is moving away from cash faster than other areas of the world. Here you can find the link to the report if you want to deep dive on it.

The second content, the report from Bain, is something that confirms what we saw and experienced in the VC market between 2022 and 2023, and maybe even now in 2024. As you can see from the figure, while Italy had a steady +24% CAGR between 2016 and 2023, the last couple of years were characterized by an inversion of the curve, with the total amount invested going from $1.4 billion in 2022 to $1.1 billion in 2023.

The main reason? According to Bain, it must be found on the number of deals, and not on the size, with a strong -24% on the number of operations between 2022 and 2023, compared to a much  more regular +4.5% in terms of deal size. Quite the opposite of what we can see around the world, where most of the time we see megarounds vanish because of the lack of liquidity from VCs.

But Italy seems to be in a stronger position than the rest of Europe. Market in France and Germany is running a solid -40%, probably impacted by years of inflated valuations, while Italy is again at -20%, with a positive +4.5% in terms of deal size, a critical indication on the positive trend that the entire startup ecosystem took recently. The average downtrend in Europe in terms of investments, is a stunning -40%.

Nothing new I fear, data confirmed what everyone in the ecosystem already experiences during the downturn. It’s not 2020 anymore, and raising funds is harder than ever, even if Italy is better positioned than other countries in Europe. Who could have guessed it? Here you can find the link to the full report if you want to deep dive.

Anyway we saw some very interesting news in the market this week. Monzo Bank expanded his last fundraising to $610 million thanks to latest investors who contributed with $190 million. In Italy, Futura raised a stunning $14 million funding round. Revolut launched his crypto platform, Revolut X in the UK, Nubank surpassed 100 million users in Latin America and Docusign acquired document management platform Lexion . Some interesting debt financing round, with iwoca securing $270 million, Plata Card $100 million from Fasanara Capital and Abound approximately $800 million. In the VC industry we saw ICONIQ Capital raising a $5.7 billion new fund, and Ventech looking for $225 million for a new fund after the exit from Believe . Finally, some very interesting funding rounds from fintech startups like Securitize , Jeeves , Abyan Capital , fundcraft , Eleos , Checkfirst, Swypex and many others.

But let's take a closer look at the main news of the last seven days:

Closed deals

• Securitize secures a $47 million founding round from BlackRock
• Corporate credit card platform Jeeves secures a $75 million financing round to expand in Latin America;
• alphastream.ai raises a seed round led by Motive Ventures;
• Iwoca secured a $270 million in financing to support one million SMEs in Europe;
• London based Abound secured a $800 million financing round ;
• Saudi based Abyan Capital closes a $18 million Series A funding round;
• Luxembourg based fundcraft raises a $5 million series A for his fund management platform;
• Daloopa raises a $18 million series B to automate financial analyst workflow;
• Cashco Financial raised a $50 million debt financing from Bastion Management;
• Eleos raises a $4 million seed round for his insurance and income protection platform;
• Philippines based Salmon Group Ltd raised $7 million funding round from IFC;
• Honeycomb Insurance secures a $36 million series B from Zeev Ventures;
• Once again, Monzo Bank is expanding their latest round, securing an additional $190 million, for a total of $610 million;
• Plata Card secured a $100 million financing round from Fasanara Capital;
• Egyptian based Swypex raises a $4 million seed round;
• Nigerian based identity company SEAMFIX raises $4.5 million for his identity management platform;
• Valencia based Sesame HR raises a $23 million funding round led by GP Bullhound;
• Checkfirst raises a $1.5 million pre-seed to innovate audit with AI;
• Big news in African fintech landscape, where Lesaka Technologies Inc. acquired adumo for $86 million;
• Fintech Farm raises $32 million to expand his "neobank in a box" model in India;
• Sidney based Kashcade raises $23 million to innovate R&D lending in Australia ;
• Panax secures $15 million to innovate cash flow management with AI;
• Numeric raises a $10 million seed round to innovate accounting with AI.

Insights on the VC industry

• VC Ventech made an exit from French startup Believe, and now is looking for $225 million for his sixth fund;
• ICONIQ Growth raised $5.75 billion for his seventh flagship fund;
• In 2024, 44% of US VC fundraising was closed by General Catalyst and Andreessen Horowitz alone;
• Stride Ventures secures $165 million for his third fund;
• Armira Growth launches a $200 million to support tech startup in DACH region;
• Ocean 14 Capital raises a $201 million fund to invest in Ocean Health.

News on the market

• BioCatch soars to $1.3 billion valuation with Pereira acquiring the majority stake;
• Vodafone wants to integrate crypto wallet with eSim;
• U GRO Capital acquires MyShubhLife in a cash and equity deal;
• Revolut launched a stand alone crypto platform in the UK, Revolut x;
• GoTyme Bank expands into payroll and lending with SAVii acquisition;
• Docusign acquires AI powered contract management firm Lexion;
• Paris based Fime will be acquired by private equity firm Gallant Capital in the payment sector;
• Danske Bank joins the rank of investors in United Fintech;
• Bitpanda is expanding his trading platform solution to the UAE;
• FIS announces Atelio by FIS: a new embedded finance platform built on the acquisition of BaaS platform Bond;
• Big news in African fintech landscape, where Lesaka Technologies Inc. acquired adumo for $86 million.
• Brasilian neobank Nubank surpasses 100 million customers in Brasil, Mexico and Colombia.

A special look in the Italian market

• Edtech startup Futura secures a $14 million round.

Startups raising funds

• Fantalegends - a Fantasy Football free-to-play mobile game that aims to provide an enjoyable and safe experience, user-centered, with more than 2k daily active users. Raising $1M.
• PopulaRise - The platform that allows companies of every dimension to promote themselves on social media through the collaboration with their clients. B2B2C SaaS. Raising $1M.
• Bitcoin People - Fintech company focused on crypto payments between corporate and cross countries. B2B, SaaS. Raising $500k. Round closed!
• Tutornow - Edtech that provides an online tutoring platform for students with learning disorders. Raising $500k to $1M.
• Recivu - Fintech  startup trying to digitize the receipt flow by getting rid of papers. Looking for $150k in SAFE, already $50k committed.
• Weagle - B2B Tech startup that provides the very first browser designed for company, with total security for sensitive data. Raising $6 millions for their seed round.
• Reach Finance - Reach is the fintech platform for wealth accumulation for the Y&Z generations, they provide users with the tools to build wealth such as a budget tracker, a financial plan and a systematization of investments. Looking for $700k, with already $500k committed;
• wrapp.ai - A fintech startups that offers a virtual accountant and CFO that can help SMEs scale globally. Looking for $1 million, $750k already granted from public funds, looking to close the last $350k.

If you are a startup and want to be present in this list, please contact me directly.

If you are an angel investor or a VC interested in those companies, contact me for an intro!

Take also a look at the last edition of the newsletter, Weekly update #27